The State of Alaska manages a Permanent Fund Dividend that returns more than $1B of oil and gas profits to its residents each year; a benefit ripe for fraudsters. Therefore; it needs to ensure all of its applicants are actually residents.
When you think of Alaska, you think of man and nature living seamlessly together. You may picture snow-capped mountains, crystal glaciers and majestic wildlife, but perhaps the best kept secret of Alaska is its Permanent Fund Dividend.
The Permanent Fund Dividend was established by the State of Alaska to return a portion of oil and gas profits to its citizens in the 1980s and has since become a source of Alaskans identity and pride. The dividend has ranged from less than $500 to more than $2000, but has always been an important source for supporting the local Alaska economy. Unfortunately, it has also become a source of fraud.
Anne Weske, Operations Manager, Permanent Fund Dividend Division, State of Alaska has been determined to prevent this fraud, especially since she knows Alaskan citizens are fiercely passionate about the Permanent Fund.
Although the Permanent Fund Dividend has an Audit and Review process, it has relied entirely on fraud tips from individuals who were suspicious of an applicant’s eligibility to receive a dividend or the return address on physical applications. However, after the State of Alaska implemented an online application, it recognized an opportunity to implement new processes. With millions of dollars on the table, it was time for action.
The State of Alaska approached Neustar for its IP GeoPoint data, which enhances how the State of Alaska monitors online transactions to detect and reduce fraud. The IP Intelligence database is the central repository for Neustar’s geolocation and network connection attributes. The IP Intelligence database maps close to 4 billion routable IP addresses worldwide, enabling its customers to build multifaceted criteria to flag suspicious transactions for further review or denial.
Weske found the IP GeoPoint data was quick and easy to implement, affordable and reliable. Her team initially used a web-based tool to verify the association of applicants IP address with Alaska, but has progressed to accessing Neustar’s REST API web service to manage the IP location checks much more efficiently and effectively.
“I can rest easy at night, knowing that the value of the Permanent Fund Dividend remains in the hand of Alaskan residents,” said Weske.
As soon as the State of Alaska integrated Neustar’s IP GeoPoint data, its Audit and Review processes were able to flag and investigate potentially fraudulent applications based on out of state IP addresses. Ultimately it identified more than 700 fraudulent applications. The overall outcome resulted in eight indictments in state or federal court, 36 civil actions and the recovery or non-release of approximately $2.6 million.
“We immediately saw the value of Neustar and continue to see the benefits today,” said Weske. “Each year we audit thousands of applications and deny hundreds of returns. We are saving millions of dollars thanks to the service provided by Neustar.”